UK Housing Observatory

A project developed by the Economics Department at Lancaster University Management School aimed at improving understanding of the UK national and regional house price dynamics.

About Us

The latest boom and bust in international housing markets has generated a renewed interest in the dynamics of house prices. The UK Housing Observatory is a project of the Economics Department at Lancaster University Management School (LUMS), led by Ivan Paya, Alisa Yusupova, Efthymios Pavlidis and David Peel, aiming to improve our understanding of the UK national and regional housing markets.

We perform real-time monitoring of domestic real estate markets both at the national and regional level. We generate indicators of house price exuberance and produce the most comprehensive publicly available forecasts of house price growth for 1,2,3 and 4 quarters ahead for the national and regional markets in the UK. Our latest results are updated every quarter in January, April, July and October. Please take note of our disclaimer in regards to the usage of our data.

Our research is not confined to the UK real estate market alone. We work in cooperation with the Federal Reserve Bank of Dallas Globalization and Monetary Policy Institute on providing similar indicators for international house price data, which are available at the The Federal Reserve Bank of Dallaswebsite.

2017 Q4 Release

Overview: The UK real property prices have declined by 0.2% during 2017. However, the decline in house prices has not been homogenous across regions. Over the last year, Greater London recorded the lowest real house price inflation among regional property markets in the UK (-3.3%).

Although the Contents contained herein are provided under the highest professional standards in the generation of these forecasts, the UK Housing Observatory does not guarantee the accuracy or completeness of any information contained herein. The UK Housing Observatory specifically disclaims all warranties, expressed or implied, with respect to the use of this information or any results with respect thereto. In addition, the information contained herein shall in no way be construed to constitute a recommendation by the UK Housing Observatory with respect to the purchase or sale of any investment, security or its derivatives.

Eviews CODE.zip for getting the sequesnce of 95% critical values from the Empirical Application of Phillips et al. (2013) , "Testing for Multiple Bubbles: Historical Episodes of Exuberance and Collapse in the S&P 500".

National level data is from Federal Reserve Bank of Dallas' International House Price Database. Each release of the database includes the following time-series: the house price index (HPI), the house price index adjusted for inflation (RHPI), the index of personal disposable income (PDI) and the index of personal disposable income adjusted for inflation (RPDI). The data is reported quarterly and goes back to the first quarter of 1975. We construct a measure of housing affordability as the ratio of RHPI to RPDI. Visit the Federal Reserve Bank of Dallas webpage for detailed description of the data construction methodology.

Regional House Price indices for 13 regions of the UK are published quarterly by the Nationwide. The dataset dates back to the fourth quarter of 1973, but we start our analysis from the first quarter of 1975. To transform the data into real values each regional series is deflated with consumer price index (CPI).

Regional Income data is obtained from the Family Expenditure Survey (FES)*. For each year, starting from 1975, the dataset is split by region** and the data on average total household's weekly expenditure is extracted. The annual data is then interpolated to obtain quarterly series.

*The FES runs from 1961 to 2001. From 2001 it was replaced by a new survey, the Expenditure and Food Survey (EFS), which became the Living Costs and Food Survey (LCF) from 2008.

**Due to the differences in regional classifications, Outer Metropolitan and Outer South East are assumed to correspond to the South East region in the regional classification adopted by the FES.